Tag Archives: ab1665

CPUC approves DSL upgrade subsidy for Frontier at $4,700 per home

by Steve Blum • , , , ,

Weimar casf project

The California Public Utilities Commission approved a $693,000 grant to Frontier Communications from the California Advanced Services Fund (CASF) for a DSL equipment upgrade in the Placer County community of Weimar earlier this month. It was a considerably smaller grant than Frontier requested.

The project originally included the somewhat larger town of Colfax and called for a CASF subsidy of $2.3 million to reach 1,400 homes that, Frontier said, lacked access to broadband service at California’s pathetic minimum of 6 Mbps download and 1 Mbps upload speeds. Other Internet service providers in the area begged to differ, however. Two wireless ISPs, Colfax.net and SmarterBroadband, which have made a habit of blocking wireline upgrades, challenged Frontier’s request, as did the local cable operator, Wave. As a result more than two-thirds of the budget and nearly 90% of the households were chopped, and the cost jumped to $4,700 per premise…

Staff notes that this is a DSL project, and the cost would be higher compared to other DSL projects approved by the Commission. The total number of households for this project is 148, which is significantly less compared to other Frontier DSL projects that range from 234 to 1,017 total households. The higher cost per household is due to the low density of eligible households in the project area. Further, in addition to the equipment upgrades to the Weimar Central Office, Frontier must also upgrade equipment facilities at its Colfax Central Office in order to serve the Weimar project area. Due to the additional equipment upgrades required in Colfax, the cost per household increased by $1,000 overall.

Frontier gave up federal money for the area, in order to maximise its Californian subsidy, which covers 90% of the construction cost for the DSL central office upgrade and 1,000 feet of new fiber, apparently for a lateral connection to a middle mile route. Frontier is only promising the minimum performance level for CASF funded projects of 10 Mbps down/1 Mbps up, but CPUC staff “estimates 50 percent of CASF-eligible households are within roughly 5,000 feet of Frontier’s terminals and should expect very fast service (25 Mbps to a maximum of 115 Mbps)”.

Frontier’s financial woes rated a mention, but didn’t raise any concerns. The CPUC resolution concluded that Frontier “has managed to stabilise its revenue and made significant efforts to reduce debt and improve its financial leverage profile”.

Plumas and Lassen County broadband projects proposed for California subsidies

by Steve Blum • , , , ,

Mohawk vista

Applications for broadband infrastructure subsidies from the California Advanced Services Fund (CASF) are due tomorrow, but the Plumas-Sierra Electric Co-op (PSEC) wasn’t in a mood to wait. It submitted five project proposals on Saturday, totalling $12 million in grant requests.

PSEC serves Plumas, Sierra and Lassen counties in northeastern California, and is one of three electrical service cooperatives in the state. It branched out into broadband service several years ago and has received both state and federal grants to build out its network.

Four of the proposals are for pure fiber-to-the-premise projects that would serve a total of 521 homes and 32 businesses in the Plumas County communities of Eureka-Johnsville, Keddie and Mohawk Vista, and Elysian Valley-Johnstonville in Lassen County. The cost per location is high, ranging from about $11,000 to $48,000 per home, and $11,000 to $44,000 per location (business and residential) overall.

All four proposals exceed the $9,300 per household cap set by the California Public Utilities Commission, which runs the CASF program. The projects could still be funded, but it will take a majority vote by the full commission to approve the applications.

The fifth project, for Lake Davis in Plumas County, uses a hybrid design – some homes would be served directly by fiber, others would rely on fixed wireless links. It would reach 185 homes and two businesses.

Each of the proposed projects includes middle mile fiber facilities, to connect to the Internet through PSEC’s core network.

These applications, and the others that are expected to drop tomorrow, are the first under the new CASF broadband infrastructure grant rules approved last year by the CPUC. It’ll be the first chance to see what kind of projects can be developed, and ultimately approved, in the new world created by the California legislature in 2017, when it bowed before the deep campaign cash pockets of AT&T, Frontier, Comcast and Charter, and passed assembly bill 1665. That law tipped California’s broadband subsidy playing field precipitously in favor of those deep pocketed incumbents. We’ll soon know if it was money well spent.

Project summaries:

Elysian Valley-Johnstonville
Eureka-Johnsville
Keddie
Lake Davis
Mohawk Vista

CPUC proposes low income, no service available requirements for household broadband extension grants

by Steve Blum • , , , ,

Remote road

The final piece of the California broadband subsidy puzzle is on the table. The California Public Utilities Commission posted a draft of the new “line extension program”. It’s a pilot project set up by the legislature in 2017 when it rigged the California Advanced Services Fund (CASF), turning it into a piggy bank for AT&T and Frontier Communications.

The line extension program was included at the urging of cable lobbyists, who wanted to tap the piggy bank too, but didn’t want to take on any of the regulatory responsibilities that normally go along with state broadband infrastructure grants. The solution was to launder the money through customers: if they live in a home that has no access to broadband, then they can apply for a grant and give the money to an Internet service provider willing to build a line extension to them. The ISP owns the new facilities, but doesn’t have to meet other CASF obligations such as price guarantees.

The new draft rules put tight restrictions on who can qualify for the money. Instead of being simply “unserved” as the California legislature defines it (i.e. without access to broadband service at speeds of at least 6 Mbps download and 1 Mbps upload), a household has to be “non-connected”, which means it “does not have a service connection to any broadband service”, at any speed. Applicants have to live at the location that will be hooked up and have an annual household income that’s low enough to qualify for the CPUC’s other low income programs – about $34,000 for a couple and $60,000 for a family of five, for example.

There’s a per-household grant limit of $5,300 for a wireline connection and $500 for a wireless one, which can pay for up to 95% of the cost of the extension. The remaining 5% has to come from the service provider that will end up owning it. A project can include more than one eligible household, so the total grant could be more, but it could also be less if the new facilities also serve ineligible homes.

For the now, the CPUC is taking comments on the draft plan. Commissioners could vote on it as early as the end of April.

AT&T, Frontier, Charter carve out exclusive California subsidy territory

by Steve Blum • , , , ,

As expected, AT&T and Frontier Communications blocked broadband infrastructure grants in vast swaths of rural California yesterday, at least for anyone but themselves. The companies filed reports with the California Public Utilities Commission stating they weren’t giving up federal Connect America Fund subsidies in any of the census blocks they claimed in 2015.

Charter Communications tried a similar trick, submitting a letter telling the CPUC where it will be upgrading video-only analog systems to digital capability later this year. There are a couple of problems with Charter’s promises, though. First, it’s admitting it hasn’t complied with the CPUC decision that allowed it to buy Time Warner’s cable systems in California. In that decision, Charter was ordered to upgrade all of its analog territory to digital capability by November, 2018. That deadline has already passed.

Second, Charter is invoking “the spirit” of the right of the first night first refusal granted by the California legislature, but not accepting any of the hard responsibilities that go along with it. As a practical matter though, if Charter delivers on its most recent promise, it could be enough to preempt any California Advanced Services Fund (CASF) grants to independent Internet service providers in its remaining analog service areas.

This right of first refusal for incumbents, and the additional privileges granted on top of it to Frontier and AT&T, were included in assembly bill 1665, which was passed by the legislature in 2017. The bill set aside $300 million for CASF infrastructure grants, and gamed the rules to make it easier for AT&T, Frontier and other incumbents to get their hands on it, but harder for potential competitors to qualify.

No other right of first refusal claims were distributed yesterday. Others might have been filed, but there’s no indication at this point that any were.

Last month, the CPUC restarted the program. The first batch of CASF infrastructure grant applications are due on 1 April 2019. We’ll find out then whether incumbents have left enough room for meaningful independent broadband upgrades anywhere in California.

Filings:

AT&T CAF–2 report, 15 January 2019
AT&T census block list, 15 January 2019
Charter Communications upgrade notice, 15 January 2019
Frontier Communications CAF–2 report, 15 January 2019
Frontier Communications census block list, 15 January 2019

Big telecom will see familiar, friendly faces at California capitol in 2019

by Steve Blum • , , , ,

California capitol horses 625

California broadband policy will be in the same legislative hands in 2019. Senate and assembly leaders announced committee assignments for the new term, and the chairs of the committees that dealt with major telecoms issues over the past couple of years remain the same.

Miguel Santiago (D – Los Angeles) retained his seat as chair of the assembly communications and conveyances committee. He didn’t make it into the top ranks – no leadership post or a seat on the powerful rules, appropriations or budget committees. But he’ll be able to continue to keep deep pocketed patrons, like AT&T, Comcast and Charter Communications, happy. As he tried to do when he (temporarily) blocked senate bill 822 – the net neutrality law – last year.

Santiago’s principal wingmen are back, too. Evan Low (D – Santa Clara) and Eduardo Garcia (D – Imperial) are once again on the communications and conveyances committee. Besides backing Santiago when he gutted SB 822, Low has (unsuccessfully) carried a copper-killer bill for AT&T and Garcia turned the California Advanced Services Fund into a $300 million piggybank, also for AT&T as well as Frontier Communications and cable companies. Garcia kept his seat on the appropriations committee; Low moves up to chair of the business and professions committee. Jay Olbernolte (R – San Bernardino), who also opposed SB 822, is back as the vice chair of the communications and conveyances committee.

The assembly privacy and consumer protection committee remains in the hands of Ed Chau (D – Los Angeles). He’s already introduced a placeholder bill that is a likely vehicle for amending the new privacy law that he authored last year. It was passed in order to block a tougher initiative that was otherwise headed to the November ballot. How he responds to the mounting pressure to soften it from tech industry interests is a key question for the coming session.

On the senate side, Ben Hueso (D – San Diego) returns as chair of the energy, utilities and communication committee. He, too, was a good friend of AT&T and other mobile carriers in 2017 when he enthusiastically, if not articulately, pushed SB 649. That bill, which was eventually vetoed by governor Brown, would have given them virtual ownership of street light poles and other municipal property they covet. The new vice chair of energy, utilities and communications is John Moorlach (R – Orange).

CPUC reboots California broadband infrastructure subsidies, as well as can be hoped

by Steve Blum • , , , ,

California has more than $300 million available to subsidise broadband infrastructure, thanks to a law passed last year by the California legislature. Also thanks to that law, the rules governing who can get the subsidies and where it can be spent were rigged, with the aim of protecting telco and cable monopolies, and funneling money into their pockets.

It was up to the California Public Utilities Commission to rewrite the rules that subsidy applicants have to follow and that govern how broadband subsidy proposals will be evaluated and approved. Or not.

That process went on for nearly a year, with lobbyists for Comcast and Charter Communications, lawyers for AT&T and a hodgepodge of staffers for Frontier Communications working hard 1. to prevent independent, competitive Internet service providers from getting any money, 2. to make sure they had unimpeded access to it, and 3. to avoid any inconvenient restrictions on what they could charge or what level of service they could deliver to subsidised communities.

Yesterday, by a unanimous vote, the CPUC approved new rules that both stay within the narrow lines drawn by telco lobbyists California lawmakers and provide independent, community-driven projects as good a chance of being funded as the law allows.

This rewrite of the California Advanced Services Fund (CASF) program was led by commissioner Martha Guzman Aceves. Following the vote, she said the goal is to focus broadband infrastructure spending on the communities that need it most, and get it to them as quickly as possible…

This [decision] approved a framework towards meeting the regional goals, now, of 98% per consortia region – those are geographical regions throughout the state – to try to get more parity and access throughout the state.

The [decision] sets up a faster application review timeline, it sets up clear funding rules that allow an applicant to determine ahead of time how much funding an application is eligible to receive…

These new rules improve the accuracy of data, as well, used to determine eligibility. Over the years we’ve had many struggles here, in our decisions, about whether or not a community is served. And this provides much clearer rules to determine that.

The PD also prioritises low income areas, that are unserved and, at best, have dial-up service. The applications that serve these unserved low income areas will receive 100% funding.

The first application window for this new round of CASF infrastructure grants closes 1 April 2018.

Revision 2 of proposed decision of commissioner Guzman Aceves, implementing the California Advanced Services Fund infrastructure account revised rules, published 12 December 2018 and approved on 13 December 2018.

Revised appendix, detailing the application process and grant eligibility rules.

Links to other documents – decisions on other issues, drafts, comments and more – are here. I’ll post the final version of the decision and the appendix there, when available. But the final version should track exactly with the revision linked above.

I’ve been involved in the debate over the CASF program, and in assisting with project proposals since 2009. I’m not a disinterested commentator. Take it for what it’s worth.

California broadband infrastructure subsidy reboot ready for CPUC vote

by Steve Blum • , , , ,

The flurry of comments and rebuttals about proposed changes to California’s primary broadband infrastructure subsidy program – the California Advanced Services Fund (CASF) – resulted in a few changes, generally for the better. A revised draft decision was published yesterday, ahead of a scheduled vote by the California Public Utilities Commission on Thursday.

Comcast’s and Charter Communications’ lobbying front organisation – the California Cable and Telecommunications Association (CCTA) – was rebuffed in its attempt to open up proposed CASF-funded projects to an eternity of challenges.

The revised draft emphasises that “there is only one opportunity to challenge a project” by demonstrating that existing service in the proposed area meets the California legislature’s pathetic minimum standard of 6 Mbps download and 1 Mbps upload speeds. That single challenge period ends five weeks after an application is submitted. CPUC staff has two weeks to post the application on the commission’s website and then incumbents have three weeks to try to kill it, if they think it threatens their monopolies. The one exception is if area is added to the proposed project during the review process, and then only the new territory is vulnerable to attack.

The revisions also put some additional streamlining in the review process, which has dragged on for more than two years in some cases. Any request for $10 million or less can be approved by staff, without having to be voted on by commissioners. The first draft had a $5 million limit. Most of the projects proposed over the past few years would have been comfortably below the new limit.

Incumbents are also opposed to a low income subscription option. The draft would subsidise an additional 10% of project costs – the baseline is 60% – if a $15 dollar a month package is offered to qualifying low income household. The cable lobbyists were joined by AT&T, Frontier Communications and a group of small rural telephone companies in objecting to it. Again, all they got for their troubles was a clearer statement of what the CPUC expects in return for giving them taxpayer money: “the low-income service offering must be offered throughout the entire project area and must meet all of the CASF performance criteria”.

At this point, a favorable vote by commissioners on Thursday is looking more likely. Yesterday, the draft was moved to Thursday’s consent agenda, which means it won’t even be debated. Assuming nothing changes (a reasonable, if not completely safe, assumption) it’ll be automatically approved along with a couple dozen other items in a single, bulk vote.

Revision 1 of proposed decision of commissioner Guzman Aceves, implementing the California Advanced Services Fund infrastructure account revised rules, 10 December 2018 (changes highlighted).

Revised appendix, 10 December 2018 (changes highlighted).

Links to other documents – decisions on other issues, drafts, comments and more – are here.

For more background information, click here.

I’ve been involved in the debate over the CASF program, and in assisting with project proposals since 2009. I’m not a disinterested commentator. Take it for what it’s worth.

Cable to defend Californian monopolies with attacks on independent projects

by Steve Blum • , , , ,

Comcast, Charter Communications and other cable companies are demanding the right “to challenge each and every application” for broadband infrastructure subsidies from the California Advanced Services Fund (CASF). Their lobbying front organisation, the California Cable and Telecommunications Association (CCTA), made their perpetual litigation plans clear in a new round of comments on the California Public Utilities Commission’s plan to reboot the program.

The cable companies also want to be able to block independent projects by cherrypicking homes and neighborhoods census blocks using the right of the first night right of first refusal given to them by the lawmakers they’ve generously funded in return. CCTA called universal service requirements advocated by other organisations “especially unreasonable”.

Like the cable lobbyists, AT&T repeated many of it previous arguments in its comments. But it did make one statement about funding middle mile facilities that is both true and useful for developing economically viable broadband projects…

If a CASF applicant and middle-mile provider cannot agree on access rates, terms, and conditions through arm’s-length negotiation, that alone is evidence that the middle-mile provider’s proposed rates, terms, and conditions are not commercially acceptable for the project at issue, and that building middle-mile infrastructure is “indispensable” to the project.

Middle mile infrastructure that connects local, last mile networks to central Internet hubs, such as those found in Silicon Valley, is essential. Incumbents – AT&T included – have used their control over those choke points to keep broadband prices high and competitors out. The CPUC should subsidise more middle mile fiber construction whenever possible, but that money should come with the same strings attached to last mile projects: grant recipients should offer it on the open market at published rates.

Several other groups submitted comments, also mostly restating earlier positions. The North Bay North Coast Broadband Consortium weighed in for the first time, urging the commission to hold incumbents accountable when they exercise a right of first refusal but don’t build out, and to give priority to projects that offer faster broadband speeds than the pathetic 10 Mbps download/1 Mbps upload service that the California legislature agreed to subsidise.

North Bay North Coast Broadband Consortium
CPUC Public Advocates Office (formerly known as the office of ratepayer advocates)
Greenlining Institute
TURN

AT&T
California Cable and Telecommunications Association (lobbyists for Comcast, Charter and other cable companies)
California Emerging Technology Fund
Geolinks
Race Telecommunications
Small Local Exchange Carriers (small, rural telcos)

Links to other documents – decisions on other issues, drafts, comments and more – are here.

Comcast and Charter fight for right to charge “exorbitant prices” for broadband connectivity

by Steve Blum • , , , ,

Comcast’s and Charter Communications’ lobbying front in Sacramento – the California Cable and Telecommunications Association (CCTA) – doesn’t want the California Public Utilities Commission to require companies that receive broadband infrastructure subsidies to make any commitments about the prices consumers will be charged, or to offer an “affordable broadband plan for low income customers”.

In comments they submitted regarding the CPUC’s proposed reboot of the California Advanced Services Fund (CASF) broadband infrastructure subsidy program, the cable lobbyists claimed that the requirements – some of which have been in place for many years – are illegal.

The lobbyists also told the CPUC that it can’t limit Charter’s and Comcast’s right to charge “exorbitant prices” for middle mile connectivity and, in the process, block competition by independent broadband providers.

CCTA objected to a new rule that would allow streamlined review of middle mile proposals in “a situation where a provider…only offers service at exorbitant prices”. Their claim is that “affordability” has nothing to do with the “availability” of middle mile service.

Bullshit.

Middle mile service links a local broadband provider – aka the “last mile” – to a major hub, such as a data center in Silicon Valley, where interconnections between networks are thick and the magic of the Internet happens. If an independent Internet service provider wants to build a last mile network in a poorly served community, the middle mile connectivity problem has to be solved in way that makes economic sense. When incumbents, like Charter, Comcast, AT&T or Frontier, kill an independent’s business model by jacking up middle mile prices – as they are allowed to do – they are deliberately making that service unavailable.

CCTA also continued to argue for the right to perpetually and continually challenge proposed projects. Derailing project applications with late challenges, sometimes based on false claims, is a tried and true tactic that incumbents use to protect their monopolies in communities where 1. their service is poor, and 2. so are residents.

The cable companies have never liked the CASF infrastructure subsidy program, and they have handed bags of cash offered cerebral arguments against it to California’s lawmakers in largely successful attempts to cripple it.

CCTA’s comments are worth reading as a reminder of why the CASF program was created in the first place.

Links to CASF reboot documents – decisions on other issues, drafts, comments and more – are here.

I drafted and submitted the comments filed by the Central Coast Broadband Consortium. I am not a disinterested commentator. Take it for what it’s worth.

Telcos, cable companies should face consequences for filing false California broadband data

by Steve Blum • , , , ,

AT&T, Frontier Communications, Charter Communications and Comcast have to file reports with the Federal Communications Commission detailing where they offer broadband service, how fast it is and what technology they use. The California Public Utilities Commission uses that information, along with other sources of data, to determine if particular areas or communities are eligible for broadband infrastructure subsidies, via the California Advanced Services Fund (CASF) program.

The CPUC is rewriting the rules for those subsidies, as a result of the generosity of California lawmakers who rigged CASF so that big, monopoly model telecoms companies get a shot at hogging all the cash.

The availability data that those incumbents provide is of dubious quality. It’s largely based on marketing claims, and not on actual speed tests or subscriber information. The CPUC’s proposed new rules highlight comments that I drafted and filed in May on behalf of the Central Coast Broadband Consortium in which we called out, as an example, obviously false data that AT&T submitted about fiber to the home service.

The CPUC draft diplomatically attributes AT&T’s false reports to “miscoding”. We filed comments last week suggesting that this isn’t the time to be speculating on AT&T’s motives or possible excuses for giving the CPUC and the FCC bad information…

We did not attribute this false data to miscoding. AT&T has established “AT&T Fiber” as an “umbrella brand” which includes technology such as “the former AT&T GigaPower network” which does not, in all regards, meet the Form 477 definition of “fiber to the home or business end user”. It is reasonable to posit a connection between AT&T’s brand positioning and its Form 477 submissions.

In its comments, Race Communications, which has received several CASF grants to build FTTH systems in rural communities, urged the CPUC to hold companies accountable for their data…

The [proposed decision] properly notes that these errors have major consequences for the CASF program, because corrections are time-consuming for the Communications Division Staff, and errors cause confusion and frustration for communities and CASF applicants who must rely on the maps for eligibility decisions. Race contends that the Commission should take a more aggressive enforcement stance if data is consistently provided to the Commission that is erroneous and/or overstated by a particular existing provider. Providing erroneous data on coverage is a [CPUC rule] violation and should be treated as such.

The rule in question says that AT&T – and everyone else who does business with the CPUC – must agree “never to mislead the Commission or its staff by an artifice or false statement of fact or law”.

Just so.

Links to CASF reboot documents – decisions on other issues, drafts, comments and more – are here.